Counting Down to the New Year: Ten “Need-to-Know” Labor and Employment Developments of 2024
2024 was yet another active year in the labor and employment landscape. While 2025 and the new administration could bring any number of changes to workplace laws and enforcement, the timing and extent of such changes is uncertain.
In the meantime, it is the current employment laws and best practices that govern employers’ relationship with their workforce—and, correspondingly, employees’ expectations of their employers. With that in mind, here are ten of the most “need-to-know” labor and employment developments of 2024, in no particular order:
1. Updates from the Supreme Court
Each year, we see decisions from the Supreme Court with a significant impact on the landscape of labor and employment law, and this year was no different. For example:
- In Loper Bright Enterprises v. Raimondo, the Supreme Court overturned the longstanding principle of “Chevron deference,” a legal principle that provided for court deference to an agency’s reasonable interpretation of the statutes it enforces. With this change, it seems likely that the traditional analysis of administrative rules and enforcement from employment-related agencies such as the Equal Employment Opportunity Commission (“EEOC”), Department of Labor (“DOL”), and National Labor Relations Board (“NLRB”) will evolve when challenged in court.
- In SEC v. Jarkesy, the Supreme Court ruled that the Securities Exchange Commission violated the Seventh Amendment by seeking civil penalties through its internal adjudicative procedures rather than through a jury trial. This case could impact agencies’ internal enforcement procedures.
- In Muldrow v. City of St. Louis, the Supreme Court espoused a standard regarding the extent of harm an employee must show to establish that their job transfer was discriminatory. Under Muldrow, an employee may have a discrimination claim arising from even an internal job transfer provided that it resulted in “some harm.” This standard could result in expanded Title VII litigation in the new year.
2. The EEOC’s Anti-Harassment Guidance
In April 2024, the EEOC released long-awaited guidance on workplace harassment. The guidance addressed a variety of issues regarding both in-person and online harassment. One concern, in particular, included the potential for harassment to occur in the virtual workplace, such as through an employer’s videoconferencing technology or e-mail systems. The guidance also set forth standards for effective anti-harassment policies, complaint processes, and employee trainings. Employers entering the new year may consider reviewing their employment policies for compliance with the EEOC’s new anti-harassment guidance.
3. The EEOC’s Regulations Concerning the Pregnant Workers Fairness Act
In yet another update from April 2024, the EEOC issued final regulations regarding the Pregnant Workers Fairness Act (“PWFA”). The PWFA went into effect in 2023 and generally requires employers to provide reasonable accommodations to employees or applicants with known limitations related to, affected by, or arising out of pregnancy, childbirth, or related medical conditions. The PWFA regulations offer guidance on PWFA implementation, including which limitations and medical conditions might require a reasonable accommodation, as well as numerous examples of reasonable accommodations. It also clarifies when employers may seek supporting documentation for an accommodation request. Employers would be wise to consider reviewing their employment policies in light of the new PWFA regulations.
For a broader review of the PWFA, please access the link here.
4. The Occupational Safety and Health Administration
2024 was a busy year for the Occupational Safety and Health Administration (“OSHA”). This included a February 2024 proposed rule that, if implemented, will modernize the workplace protections for emergency response workers. In July 2024, OSHA issued another proposed rule regarding heat-related injuries and illnesses in the workplace. If these rules are finalized, they with likely come with many novel, significant requirements for employers with workers covered by their standards.
5. The DOL’s Guidance on Artificial Intelligence
As AI becomes more widespread, employers will need to reckon with the many facets of AI in the workplace. In May 2024, the DOL published guidance regarding employers’ use of AI in their employment practices. This guidance, which was further updated in October 2024, offered eight “AI Principles” for employers, as well as a series of practices aimed at helping employers “harness AI technologies for their businesses while ensuring workers benefit from new opportunities created by AI and are protected from its potential harms.”
6. Reverse Discrimination and DEI Programs
Legal action continues to simmer around DEI programs in the workplace and otherwise. Some challenges, including a lawsuit on the Supreme Court’s docket in 2025, focus on “reverse discrimination” claims where an employee claims they were discriminated against based on their status in a majority group. In Ames v. Ohio Department of Youth Services, the Supreme Court is expected to address the legal standard for reverse discrimination claims.
Ames is just one example of how reverse discrimination litigation, and Title VII litigation more broadly, will continue into the new year. Employers will want stay availed of the inevitable changes this litigation will bring.
7. The Federal Trade Commission’s Non-Compete Rule
In April 2024, the Federal Trade Commission (“FTC”) issued a proposed final rule that would ban most employers from entering into non-compete agreements with their workers, and from otherwise enforcing non-compete agreements against most workers. Initially meant to become effective on September 4, 2024, the FTC’s non-compete rule also would have required employers to notify any worker subject to an unlawful non-compete agreement that their non-compete agreement was no longer valid.
However, just prior to the September 4 effective date, a Texas court set aside the FTC’s non-compete rule and prohibited its enforcement nationwide. Litigation on this issue is ongoing, and it may take input from the Supreme Court before the lawfulness of the non-compete rule is resolved. Accordingly, employers should keep an eye on the status of the non-compete rule as they enter the new year.
For a broader review of the FTC’s non-compete rule, access the link here. For a broader review of the Texas court’s nationwide prohibition on enforcement of the FTC’s non-compete rule, access the link here.
8. The DOL’s Overtime Rule
In April 2024, the DOL issued a final rule increasing the salary levels that must be paid for an employee to be exempt from minimum wage and overtime under the “White Collar” exemptions and the “Highly-Compensated Employee” exemption of the Fair Labor Standards Act (“FLSA”). The first increase in salary levels occurred in July 2024 and included an automatic updating mechanism on January 1, 2025, on July 1, 2027, and again every three years thereafter.
On November 15, 2024, a Texas court set aside and vacated the DOL’s overtime rule. Nevertheless, much like the FTC’s non-compete rule, the overtime rule is still the subject of ongoing litigation, and it is possible the overtime rule could find new life in a subsequent court ruling. Accordingly, employers should continue to monitor the status of the DOL’s overtime rule.
Regardless of the prevailing salary threshold, the FLSA relies on a two-part test for determining overtime eligibility, and salary alone is not dispositive. Employers should work with legal counsel to confirm the appropriate standard and audit employee exemptions.
For a broader review of the DOL’s overtime rule, access the link here. For a broader review of the Texas court’s decision on the overtime rule, access the link here.
9. The DOL’s Final Rule on Employee vs. Independent Contractor Classification
On January 10, 2024, the DOL published its final rule on how to analyze whether a worker is an employee or an independent contractor under the FLSA. The previous rule was more employer-friendly and focused primarily on two factors concerning the degree of control, and the worker’s opportunity for profit or loss. The new rule expands the FLSA’s protections to more workers by using a six factor “economic realities” test, under which no one factor or set of factors holds more weight than the others. Regardless of the applicable standard, worker misclassification remains a legal risk for companies across both government enforcement and private litigation. Companies working with independent contractors should be cognizant of this rule as they enter the new year, and might consider using the new year as an opportunity to review their independent contractor relationships.
For a broader review of the DOL’s classification rule, access the link here.
10. The NLRB General Counsel’s Attack on Non-Compete and Stay-or-Pay Agreements
The (likely outgoing) General Counsel of the NLRB has long taken the position that the maintenance and enforcement of non-compete agreements for non-management employees violates employees’ labor rights in all but rare circumstances. In June 2024, we saw one NLRB administrative judge take the General Counsel’s side in this regard. Since then, the General Counsel expanded her position with an October 2024 memo, wherein she outlined potentially extensive damages for which employers with unlawful non-compete agreements might be responsible. That same memo put “stay-or-pay” agreements—agreements where an employee must repay their employer if they separate from employment within a certain timeframe—on the chopping block, as well.
For a broader review of the NLRB General Counsel’s October 2024 memo, access the link here.
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These snapshots highlight that the workplace is heading into 2025 from a substantially different position than the one in which it started. If you have questions about these updates or how to best prepare your workplace for 2025, please contact a member of the Brooks Pierce Labor and Employment Team for assistance.